Be Wary When Giving: There Are Some Rotten Indian Charities

As the director of a national nonprofit organization serving Indian people, I know how hard it is to meet expectations of the people who evaluate us. We are not perfect, but many of the “Indian” charities are simply rotten.

One of our large donors asked me 20 years ago to research the charities she was giving money to. There were over 100 of them, with some 25 being Indian charities. Out of the 25, about 20 were rotten. It was way beyond my expectations. She curtailed her giving to most of them.

Indian charities serve education, health, economic development, domestic abuse, and many other causes. Most of them are run by non-Indians, which is admirable, but the rotten ones need to be held accountable.

My best friend told me about one of them 40 years ago. His mother-in-law worked there, opening checks and preparing bank deposits most of the day. They had a well-oiled machine. But they abused their privileges; they had their own airplane to fly the money into the bank every day. They are still doing that.

The latest bad news is that the former director of the National Relief Charities (NRC), Brian Brown, has been indicted for stealing $4 million from that organization. He was charged with wire fraud and money laundering. Allegedly for years he had a new Cadillac leased and paid for by the organization.

(I also hate to admit this, but one of our supposedly honest Indian nonprofits also paid for a leased Cadillac for its former executive director. To their credit, when the board found out, they let him go.)

Brown was on his way back from a trip to Thailand and Japan when he was arrested at Portland, Oregon International Airport on October 20, 2013. He had spent $275,000 of the $4 million to buy a condo in Thailand, where he lived from 2006 to 2013. FBI agents and federal prosecutors are trying to determine if he used his overseas connections to hide some of his assets. They could use this to bring additional charges against him.

He was receiving monthly payments from NRC to fund a nonprofit he had established on his own, the American Indian Education Endowment Fund. NRC sent him a total of $4 million, which he was supposed to be using for scholarships, but U. S. Attorney Amanda Marshall alleged that he had not paid any of it out for that purpose. He kept it all. She alleges that he provided false financial statements to the NRC to delude them into thinking he was using the money properly.

“Anyone who defrauds a charity for their own personal gain should expect to be found, caught, and prosecuted,” she said in a press release.

NRC raised $45 million last year, but their overhead is large. They spent almost $18 million on fundraising expenses—a very large amount. Very little of the money they raise gets to their target audience, which is supposed to be Indians living on reservations. One of the stories I heard about them 20 years ago is that they spent a few hundred dollars buying vegetable seeds and took them to reservations in South Dakota.

Most of the charities play on the “poor Indian” routine. It may be children, or the elderly, or the unemployed. One of my friends has called me twice in the past few weeks asking if an appeal he has gotten on the phone is legitimate. I asked him for the name of the charity, which he had forgotten. But they have gall. They asked him for $4,000.

The Attorney General of Pennsylvania, Mike Fisher, charged NRC, which was still the American Indian Relief Council, in 1993 with using false claims in its mail appeals. They claimed that Indians were starving to death on South Dakota reservations, among other outlandish claims. They agreed to pay $395,000 in restitution to the state, which then paid the money to three South Dakota reservations—Pine Ridge, Rosebud, and Cheyenne River. The American Institute of Philanthropy (AIP), one of five accrediting agencies for nonprofits, gave NRC a grade of F.

According to an article in the Phoenix New Times on December 26, 1996, reporter Paul Rubin detailed how Brown had moved the NRC from Rapid City to Phoenix, changed its name, hired a new manager, and stepped up its fleecing activities. The title of the article was “Finances with Wolves.” It partly forced Brown to move the so-called charity to Beaverton, Oregon, his hometown.

“For a lot of Indian families on the reservation,” reads a note from Brown that’s quoted by the New Times, “the basic nutritious food we supply is often the first well-balanced meal they’ve had in weeks or months.” Brown never had contact with the tribal officials of the tribes he was allegedly serving, who were outraged when they found out what he was doing.

In 1995, NRC paid its attorneys $175,000—more than it paid to its Indian clients. They have also used several names, including American Indian Relief Council, the Famine Relief Fund, and the Council of Indian Nations. Tom Hennessey, the general manager when NRC was located in Phoenix, is convinced that Brian Brown is nothing but a scam artist.

I hate to be the bearer of bad news. And I hate it that so few of the donors to these charities will see this column. If they do, I hope they will check out the rotten Indian charities before they send their hard-earned money to a bad charity.

Dr. Dean Chavers runs Catching the Dream, a Native scholarship program in Albuquerque. His next book will be “The American Indian Dropout,” to be published by Peter Lang in the spring. Contact him at CTD4DeanChavers@aol.com.